McNealy weighs in on Microsoft at Harvard conference

May 27, 1998 — The U.S. Department of Justice (DOJ) antitrust lawsuit against Microsoft Corp. should lead to consumers having more choices for their PC operating system, said Scott McNealy chairman, president and chief executive officer of Sun Microsystems Inc. at a speech in Cambridge, MA.

At both his keynote presentation and a press conference during the Harvard Conference on Internet & Society, McNealy blasted Microsoft for predatory pricing, anti-competitive business practices, and monopoly control over operating systems.

“Choice — that’s what it’s all about,” McNealy said. “I think the long-term outcome is that you have a choice on your desktop and I don’t mean (a choice of) Windows 95 or Windows 98,” McNealy said in response to a question from a discussion moderator about what the DOJ lawsuit should accomplish. His brief keynote remarks were followed by a “conversation” with two moderators — both Harvard University professors — that touched on Microsoft.

Sun also is locked in legal battle with rival Microsoft, alleging that Microsoft violated terms of its license for Sun’s Java programming language. That case is in court in California. Last week, the DOJ and 20 U.S. state attorneys general filed antitrust lawsuits against Microsoft, alleging that the company has used its control of the operating system market to move into other areas, notably the Internet browser market.

At the heart of the lawsuits, which have been combined into one overall suit by a federal judge, the DOJ and the states argue that Microsoft should not be allowed to continue bundling its Internet Explorer browser software with the Windows operating system. Questioned about the case, McNealy seemed most perturbed by Microsoft’s hold on operating systems, with some 90 percent of all computers running on Windows.

He repeatedly referred to “10 million lines of code” and the need to reboot often when using Microsoft software.

“Even you goof-offs who do nothing better with your time than play with your desktop — do you use 10 million lines of code?” he asked during the keynote discussion.

Microsoft’s anti-competitive business practices are akin to the approach of John D. Rockefeller, whose name frequently has been invoked regarding the Microsoft case. Rockefeller’s business practices were successfully challenged by the U.S. government and led to current antitrust law.

“You have no competition. You have no innovation. You have no choice,” McNealy said of the market environment that has been created by Microsoft’s hardball tactics.

Similar to Rockefeller and his hold on oil and railroads earlier this century, McNealy said that the government’s job is not to help Sun but to help consumers by making sure Microsoft “abides by the contracts they sign.”

Regarding the Sun case against Microsoft, McNealy tempered his remarks somewhat at a press conference following the keynote, veering away from talking about specifics.

“Did they knowingly enter into the Java contract in bad faith?” McNealy asked, noting that that, a key issue, is “up for a court to decide. Certainly, it’s not becoming of a monopolist to act that way.”